Efficient copyright infringement

Iowa Law Review

Volumn 98, Issue 5, 2013, Pages 1791-1846

  Fagundes, David ^a,b,c  

^a Southwestern Law School and the Biederman Entertainment and Media Law Institute   (United States)

^b HARVARD COLLEGE   (United States)

^c HARVARD LAW SCHOOL   (United States)

Author keywords

[No Author keywords available]

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EID: 84888223888     PISSN: 00210552     EISSN: None     Source Type: Journal    
DOI: None     Document Type: Review

References (167)

1. THE FEDERALIST NO. 43, at 214 (James Madison) (Lawrence Goldman ed., 2008).
2. PruneYard Shopping Ctr. v. Robins, 447 U.S. 74, 88 (1980) (holding that affirmative speech rights under the California Constitution allowed individuals to demonstrate peacefully in private areas open to the public); State v. Shack, 277 A.2d 369, 375 (N.J. 1971) (dismissing a trespass suit against defendants who entered private property without permission in order to provide migrant workers health care and legal services).
3. WAYNE R. LAFAVE & AUSTIN W. SCOTT, JR., CRIMINAL LAW § 5.7(a), at 454-55 (2d ed. 1986).
4. See Ben Depoorter, Fair Trespass, 111 COLUM. L. REV. 1090, 1092-93, 1099-113 (2011) (describing variance in exceptions to the right to exclude).
5. 40 AM. JUR. 2D Homicide §§ 134-39 (2008) (cataloguing some of the different state approaches to killing in self-defense).
6. See, e.g., Richard R.W. Brooks, The Efficient Performance Hypothesis, 116 YALE L.J. 568, 573 (2006) (articulating an alternative to the efficient breach approach that would allow promisees the option to choose "between performance and [breach with] disgorgement of the promisor's cost").
7. Jessica Litman, Lawful Personal Use, 85 TEX. L. REV. 1871 (2007).
8. Rebecca Tushnet, Copy This Essay: How Fair Use Doctrine Harms Free Speech and How Copying Serves It, 114 YALE L.J. 535, 562-586 (2004).
9. EDUARDO MOISéS PEÑALVER & SONIA K. KATYAL, PROPERTY OUTLAWS: HOW SQUATTERS, PIRATES, AND PROTESTERS IMPROVE THE LAW OF OWNERSHIP (2010).
10. See Brett M. Frischmann & Mark A. Lemley, Spillovers, 107 COLUM. L. REV. 257 (2007) (discussing positive externalities - spillovers - as a common and desirable feature of intellectual property systems, rather than problems in need of a solution).
11. Sony Corp. of Am. v. Universal City Studios, Inc., 464 U.S. 417, 429 (1984) ("The monopoly privileges that Congress may authorize are neither unlimited nor primarily designed to provide a special private benefit. Rather, the limited grant is a means by which an important public purpose may be achieved.").
12. I use "efficiency" here to refer broadly to the maximization of social welfare (hence more or less interchangeably with "welfare enhancing"). The notion of efficiency in the copyright setting can be refined somewhat to refer to the maximization of social welfare via creative production. For a good overview - and critique - of different formulations of the term "efficiency," see Gary Lawson, Efficiency and Individualism, 42 DUKE L.J. 53, 75-97 (1992).
13. See Henry E. Smith, Exclusion Versus Governance: Two Strategies for Delineating Property Rights, 31 J. LEGAL STUD. S453, S454-55 (2002) (comparing exclusion and governance strategies for managing property). Physical property owners' rights are far from absolute. Doctrines like adverse possession (for real property) and accession (for chattels) provide for title transfer to beneficial users under certain narrowly drawn conditions.
14. See Eric T. Freyfogle, Commentary, Private Property - Correcting the Half-Truths, PLAN. & ENVTL. L., Oct. 2007, at 3, 7 (observing the public-private character of property entitlements).
15. See Harold Demsetz, Toward a Theory of Property Rights, 57 AM. ECON. REV. 347 (1967) (arguing that property rights emerge in order to allow owners to internalize as much value as possible from the exploitation of their res).
16. United States v. Paramount Pictures, Inc., 334 U.S. 131, 158 (1948) ("The copyright law, like the patent statutes, makes reward to the owner a secondary consideration.").
17. WILLIAM M. LANDES & RICHARD A. POSNER, THE ECONOMIC STRUCTURE OF INTELLECTUAL PROPERTY LAW 71-84 (2003) (presenting a formal model of the cost-benefit structure of copyright's incentive system);
18. Matthew J. Sag, Beyond Abstraction: The Law and Economics of Copyright Scope and Doctrinal Efficiency, 81 TUL. L. REV. 187, 198-217 (2006) (discussing the impacts changes in the scope of copyright can have on creative production).
19. Jonathan M. Barnett, What's So Bad About Stealing?, 4 J. TORT L. 1, 21 (2011) (characterizing creative production as "a cumulative process consisting of an unfolding sequence of first-mover and n-mover creations").
20. See, e.g., ROBERT P. MERGES, JUSTIFYING INTELLECTUAL PROPERTY (2012) (identifying and exploring the difficult question of how to balance the monopoly costs of intellectual property rights with their beneficial capacity to encourage creative production).
21. The most exhaustive study to date on whether the current level of copyright protection maximizes cultural production returned indeterminate results. See Raymond Shih Ray Ku et al., Does Copyright Law Promote Creativity? An Empirical Analysis of Copyright's Bounty, 62 VAND. L. REV. 1669 (2009).
22. Dan L. Burk, Law and Economics of Intellectual Property: In Search of First Principles 7 (Univ. of Cal., Irvine Sch. of Law, Legal Studies Research Paper Series No. 2012-60, 2012), available at http://papers.ssrn.com/sol3/ papers.cfm?abstract-id=2113975 ("The intellectual property right . . . places a legal fence around goods that cannot be physically fenced off. In economic terms, it gives the owner of the intellectual property market power: the ability to raise prices and restrict output - in this case, above the marginal distribution cost of a public good. Market power is associated with the economics of monopolization . . . .").
23. Cf., e.g., LAWRENCE LESSIG, FREE CULTURE: HOW BIG MEDIA USES TECHNOLOGY AND THE LAW TO LOCK DOWN CULTURE AND CONTROL CREATIVITY 229-34 (2004) (describing the legislative process leading to the passage of the Copyright Term Extension Act of 1998 as a classic example of "rent-seeking" legislation - a law designed solely to enrich a particular powerful interest group).
24. See Adrian Vermeule, Holmes on Emergencies, 61 STAN. L. REV. 163, 178 (2008) (describing the features and possible advantages of common law minimalism).
25. The Copyright Term Extension Act and Digital Millennium Copyright Act were both passed in 1998 with little resistance, even though they represented massive changes to the landscape of information regulation. The public slowly grew aware of the implications of both Acts, though, and responded with increased attention to future revisions to copyright law. See, e.g., Peter J. Strand, What a Short Strange Trip It's Been: Sound Recordings and the Work Made for Hire Doctrine, 18 ENT. & SPORTS LAW. 12, 12-13 (2000) (cataloguing the music industry's successful opposition to a "technical amendment" in the Act that would have defined sound recordings as commissioned works made for hire). Some expansions of copyright have taken place with relatively little resistance, such as the Family Entertainment and Copyright Act of 2005 (which passed the Senate unanimously), while others have been met with outrage, such as the Stop Online Piracy Act of 2012.
26. See Lauren Kelley, Amid Voter Outrage, Lawmakers Backpedal on SOPA/PIPA; Upcoming Hearing Canceled, ALTERNET (Jan. 14, 2012, 6:06 AM), http://www.alternet.org/newsandviews/article/762548/amid-voter-outrage, -lawmakers-backpedal-on-sopa-pipa%3B-upcoming-hearing-canceled.
27. The 1831 Act extended the initial term of copyright from fourteen to twenty-eight years. See Thomas B. Nachbar, Constructing Copyright's Mythology, 6 GREEN BAG 37, 39 (2002).
28. See Paul Goldstein, Derivative Rights and Derivative Works in Copyright, 30 J. COPYRIGHT SOC'Y U.S.A. 209, 213 (1983) (describing the genesis of today's adaptation right in the nineteenth-century controversy over Stowe's unsuccessful attempt to bring an infringement lawsuit regarding an unauthorized German translation of her novel).
29. See JESSICA LITMAN, DIGITAL COPYRIGHT 35-63 (2001) (cataloguing the owner-friendly copyright expansion of the past half-century).
30. U.S. CONST. art. I, § 8, cl. 8; Fox Film Corp. v. Doyal, 286 U.S. 123, 127 (1932) ("The sole interest of the United States . . . in conferring [a copyright] lie[s] in the general benefits derived by the public from the labors of authors.").
31. Twentieth Century Music Corp. v. Aiken, 422 U.S. 151, 156 (1975) ("The immediate effect of our copyright law is to secure a fair return for an author's creative labor. But the ultimate aim is, by this incentive, to stimulate artistic creativity for the general public good." (internal quotation marks omitted)).
32. Schnapper v. Foley, 667 F.2d 102, 112 (D.C. Cir. 1981) ("[W]e cannot accept appellants' argument that the introductory language of the Copyright Clause constitutes a limit on congressional power.").
33. Eldred v. Ashcroft, 255 F.3d 849, 854 (D.C. Cir. 2001) (Sentelle, J., dissenting) (describing the Progress Clause as an "express limitation[]" on congressional power), aff'd, 537 U.S. 186 (2003). The Supreme Court later implicitly accepted the proposition that the Progress Clause did effect a substantive limitation on congressional power, even though the Court ultimately did not invalidate legislation as beyond the boundaries prescribed by the Clause.
34. Golan v. Holder, 132 S. Ct. 873, 894 (2012);
35. Eldred v. Ashcroft, 537 U.S. 186, 221-22 (2003).
36. Sony Corp. of Am. v. Universal City Studios, Inc., 464 U.S. 417, 428 (1984) (quoting U.S. CONST. art. I, § 8, cl. 8). "The monopoly privileges that Congress may authorize are neither unlimited nor primarily designed to provide a special private benefit. Rather, the limited grant is a means by which an important public purpose may be achieved." Id. at 429.
37. E.g., Robert L. Birmingham, Breach of Contract, Damage Measures, and Economic Efficiency, 24 RUTGERS L. REV. 273, 284 (1970) ("Repudiation of obligations should be encouraged where the promisor is able to profit from his default after placing his promisee in as good a position as he would have occupied had performance been rendered."). Efficient breach is more a "notion" than a "doctrine" because it is really an idea that has been used to explain why common law contract doctrine does not permit exemplary or punitive damages. RICHARD A. POSNER, ECONOMIC ANALYSIS OF LAW 15963 (8th ed. 2011) (propounding an efficient breach explanation of contract law's lack of such damages).
38. Courts have typically respected instances of efficient breach by limiting defendant-promisees' remedies to expectation damages. E.g., Lake River Corp. v. Carborundum Co., 769 F.2d 1284, 1289 (7th Cir. 1985).
39. Efficient breach has its critics, some of whom argue that contract represents a moral obligation that should not be breached regardless of economic considerations, e.g., CHARLES FRIED, CONTRACT AS PROMISE: A THEORY OF CONTRACTUAL OBLIGATION 14-17 (1981), and others who argue that the efficient-breach theory fails to maximize social welfare
40. e.g., Charles Calleros, Punitive Damages, Liquidated Damages, and Clauses Pénales in Contract Actions: A Comparative Analysis of the American Common Law and the French Civil Code, 32 BROOK. J. INT'L L. 67, 87-88 (2006) (summarizing welfarist critiques of the efficient breach hypothesis).
41. 17 U.S.C. § 504(a)-(b) (2006 & Supp. V 2011) (outlining the actual damages remedy scheme).
42. See Jules Coleman, The Normative Basis of Economic Analysis: A Critical Review of Richard Posner's The Economics of Justice, 34 STAN. L. REV. 1105, 1106-07 (1982) (book review) (explaining and comparing Pareto superiority, Pareto optimality, and Kaldor-Hicks efficiency).
43. Single iTunes tracks range from $0.69 to $1.29 in the United States. iTunes Store: iTunes Plus Frequently Asked Questions (FAQ), APPLE, http://support.apple.com/kb/ht1711 (last visited May 12, 2013).
44. This definition excludes the various uses listed in §§ 107-122 of the Copyright Act. 17 U.S.C §§ 107-22. While these uses may not be privately authorized by owners, they are authorized by law, hence their definition as not-infringing. E.g., id. § 107 ("Fair use . . . is not an infringement of copyright.").
45. For good overviews of the moral-rights perspective on copyright, see ROBERTA ROSENTHAL KWALL, THE SOUL OF CREATIVITY: FORGING A MORAL RIGHTS LAW FOR THE UNITED STATES (2010); Laura Gassaway, Copyright and Moral Rights, SPECIAL LIBRARIES ASS'N (Dec. 2002), www.sla.org/content/Shop/Information/infoonline/ 2002/dec02830/copycorner.cfm.
46. See JONATHAN HAIDT, THE RIGHTEOUS MIND: WHY GOOD PEOPLE ARE DIVIDED BY POLITICS AND RELIGION 24-25 (2012) (reporting the results of numerous studies showing that people who have an instinctively negative moral reaction to conduct strongly assume that the conduct will have negative social effects as well, even where there is no evidence for the latter claim).
47. These kinds of predictive empirical claims about social welfare are always to some degree indeterminate. Cf. Frank I. Michelman, Property, Utility, and Fairness: Comments on the Ethical Foundations of "Just Compensation" Law, 80 HARV. L. REV. 1165, 1180 (1967) (reflecting on "[t]he inability of outside observers to appraise the efficiency of proposed social measures").
48. Cf., e.g., Jacque v. Steenberg Homes, Inc., 563 N.W.2d 154, 159-61 (Wis. 1997) (authorizing an award of exemplary damages for economically costless trespass as a means of compensating owners for dignitary harm).
49. This is not to say that U.S. law protects the dignitary interests of owners, as moral rights regimes generally do; indeed, most courts agree that U.S. copyright law generally does not offer this protection. See Gilliam v. Am. Broad. Cos., 538 F.2d 14, 24 (2d Cir. 1976) ("American copyright law . . . seeks to vindicate the economic, rather than the personal, rights of authors."). My assertion is merely that owners themselves may well feel that unauthorized use affronts their dignity. See, e.g., E-mail exchange between Kirsten Kowalski and David Fagundes, Professor of Law, Sw. Law Sch. (on file with author) (explaining that unauthorized use of Kowalski's photography on the internet is a greater concern to her from a dignitary, rather than an economic, perspective).
50. Cf. Tess Wilkinson-Ryan & David A. Hoffman, Breach Is for Suckers, 63 VAND. L. REV. 1003, 1005 (2010) (reporting results of a study showing "suckers," such as the aggrieved parties in a breach of contract situation, are sensitive to exploitation).
51. See DAN ARIELY, PREDICTABLY IRRATIONAL: THE HIDDEN FORCES THAT SHAPE OUR DECISIONS 75-82 (Harper Perennial 2010) (2008) (showing that market motivations tend to dominate and crowd out altruistic motivations).
52. Christopher Sprigman, Copyright and the Rule of Reason, 7 J. ON TELECOMM. & HIGH TECH. L. 317, 334-38 (2009) (defining and discussing "consumptive" use).
53. See generally KAL RAUSTIALA & CHRISTOPHER SPRIGMAN, THE KNOCKOFF ECONOMY: HOW IMITATION SPARKS INNOVATION (2012) (discussing the underappreciated but numerous benefits owners of copied works receive from copying).
54. Motion Picture Association of America ("MPAA") President Jack Valenti famously testified to Congress "that the VCR is to the American film producer and the American public as the Boston strangler is to the woman home alone." Home Recording of Copyrighted Works: Hearing on H.R. 4783, H.R. 4794, H.R. 4808, H.R. 5250, H.R. 5488, and H.R. 5705 Before the Subcomm. on Courts, Civil Liberties & the Admin. of Justice of the H. Comm. on the Judiciary, 97th Cong. 8 (1983). A few years later, it became clear that Valenti had it exactly wrong. The advent of the videotape medium actually turned out to diversify and expand the market for movies and has been an enormously lucrative development for the film industry. See Giovanna Fessenden, Note, Peer-to-Peer Technology: Analysis of Contributory Infringement and Fair Use, 42 IDEA 391, 392-93 (2002).
55. Noam Cohen, Viewing Journalism as a Work of Art, N.Y. TIMES (Mar. 23, 2009), http://www.nytimes.com/2009/03/24/arts/design/24photo.html.
56. It was not clear who owned the rights to the Obama photograph Fairey used. Garcia claimed he did, while AP argued that Garcia had contractually assigned to it all rights in the work. See Randy Kennedy, Artist Sues the A.P. over Obama Image, N.Y. TIMES (Feb. 9, 2009), http://www.nytimes.com/2009/02/10/ arts/design/10fair.html.
57. This concern has become known as the "orphan works" problem. See NEIL WEINSTOCK NETANEL, COPYRIGHT'S PARADOX 200-02 (2008) (discussing orphan works).
58. R.H. Coase, The Problem of Social Cost, 3 J.L. & ECON. 1, 15-19 (1960);
59. cf. Guido Calabresi & A. Douglas Melamed, Property Rules, Liability Rules, and Inalienability: One View of the Cathedral, 85 HARV. L. REV. 1089, 1094-95 & n.12 (1972) (analyzing property rights through the lens of transaction costs).
60. Wendy J. Gordon, Fair Use as Market Failure: A Structural and Economic Analysis of the Betamax Case and Its Predecessors, 82 COLUM. L. REV. 1600, 1608 (1982) ("When the transaction costs outweigh the net benefits that the parties would otherwise anticipate from a transfer, then the presence of the transaction costs may block an otherwise desirable shift in resource use.").
61. This number of samples is high, but not unusually so. Most hip-hop tracks contain only ten or so samples, though they are often frequently repeated throughout the track. Some artists, however, construct tracks entirely from samples that may be much greater in number. The DJ Girl Talk, for example, used 373 samples to comprise his album All Day. Zachary Lazar, The 373-Hit Wonder, N.Y. TIMES (Jan. 6, 2011), http://www.nytimes.com/2011/01/09/magazine/ 09GirlTalk-t.html?-r=0.
62. Musicians of various levels of popularity have made their albums available on a donation basis. Some popular groups, like Radiohead and Nine Inch Nails, have earned millions in voluntary donations, though less famous indie artists have not had similar pecuniary success. See Ernesto, NiN's Donation Model Doesn't Work for Most Artists, TORRENTFREAK (Oct. 25, 2008), http://torrentfreak.com/nins-donation-model-doesnt-work-for-most-artists-081025/ .
63. Am. Geophysical Union v. Texaco Inc., 60 F.3d 913, 931 (2d Cir. 1994);
64. see also Princeton Univ. Press v. Mich. Document Servs., Inc., 99 F.3d 1381, 1392 (6th Cir. 1996).
65. Marc Fisher, Download Uproar: Record Industry Goes After Personal Use, WASH. POST (Dec. 30, 2007), http://www.washingtonpost.com/wpdyn/content/article/ 2007/12/28/AR2007122800693.html (describing pending litigation against Jeffrey Howell).
66. See, e.g., Cartoon Network LP, v. CSC Holdings, Inc., 536 F.3d 121, 130 (2d Cir. 2008) (avoiding a finding of infringement for a remote storage DVR only on the theory that temporary buffering did not last long enough to constitute a fixation).
67. See Will Pinterest Fall into Napster's Legal Trap?, WEEK (Mar. 16, 2012), http://theweek.com/article/index/225677/will-pinterest-fall-into-napsters- legal-trap.
68. Steve Green, Righthaven Extends Copyright Lawsuit Campaign to Individual Web Posters, LAS VEGAS SUN (Jan. 12, 2011, 4:33 PM), http://www.lasvegassun.com/ news/2011/jan/12/righthaven-extends-copyright-lawsuitcampaign-indi/. Righthaven has recently developed a different strategy, acquiring from copyright owners not just a bare right to sue, but an assignment of the copyright, with a subsequent nonexclusive license back to the initial owner for all of the use rights in the work.
69. The Ninth Circuit recently held that such assignments are ineffective at conferring standing on Righthaven. Righthaven, LLC v. Hoehn, Nos. 11-16751, 11-16776, 2013 WL 1908876, at *1 (9th Cir. May 9, 2013).
70. Righthaven, LLC v. Hoehn, 792 F. Supp. 2d 1138, 1147 (D. Nev. 2011) (dimissing Righthaven's infringement suit against user on jurisdictional and fair use grounds), aff'd, 2013 WL 1908876, at &z.ast;1 (affirming dismissal on jurisdictional grounds).
71. See, e.g., Masterfile Corp. v. Gale, No. 2:09-cv-966, 2011 WL 4702862 (D. Utah Oct. 4, 2011) (granting summary judgment to Masterfile against a company that purchased and displayed online a presentation featuring unauthorized images). Masterfile and Getty's relative success compared to Righthaven lies in their very different relationship with the owners of the works they acquire. Getty and Masterfile acquire rights to the works they administer and engage in the licensing of those works. Filing suit for unauthorized use is merely part of Getty and Masterfile's purpose. By contrast, Righthaven exists purely for the purpose of suing, and scaring into settlement, as many unauthorized users as possible.
72. See David Kravets, Defunct Copyright Troll Seeks Resurrection, WIRED (July 3, 2012, 2:03 PM), http://www.wired.com/threatlevel/2012/07/righthaven- second-life/.
73. Marc Hogan, Beastie Boys Hit with Sampling Lawsuit on Eve of MCA's Death, SPIN (May 8, 2012, 12:08 PM), http://www.spin.com/#articles/beastie-boys-hit- sampling-lawsuit-eve-mcasdeath.
74. The Sixth Circuit's famously terse approach to the issue epitomizes this approach. "Get a license," it stated in holding that a four-second clip infringed the plaintiff's sound recording, "or do not sample." Bridgeport Music, Inc. V. Dimension Films, 410 F.3d 792, 801 (6th Cir. 2005).
75. See Paul Cullum, Freedom of Information: Copyright and Its Discontents, L.A. WEEKLY (Aug. 17, 2006), http://www.laweekly.com/2006-08-17/film-tv/freedom- of-information.
76. Elaine Dutka, No Free Samples for Documentaries: Seeking Film Clips with the Fair-Use Doctrine, N.Y. TIMES (May 28, 2006), http://www.nytimes.com/2006/ 05/28/movies/28dutk.html.
77. Other documentarians have observed that the costs - including transaction costs - of licensing clips have made producing certain kinds of films "almost impossible." Kimberley Brown, Copyright vs. Creativity, REALSCREEN (June 1, 2005), http://realscreen.com/2005/06/01/copyright-20050601/ (internal quotation marks omitted);
78. see also PATRICIA AUFDERHEIDE & PETER JASZI, CTR. FOR SOC. MEDIA, UNTOLD STORIES: CREATIVE CONSEQUENCES OF THE RIGHTS CLEARANCE CULTURE FOR DOCUMENTARY FILMMAKERS, 7-29 (2004), available at http://www. centerforsocialmedia.org/sites/default/files/UNTOLDSTORIES-Report.pdf (cataloguing difficulties of rights clearance for documentarians making works with numerous clips).
79. See Wendy J. Gordon, Excuse and Justification in the Law of Fair Use: Transaction Costs Have Always Been Only Part of the Story, 50 J. COPYRIGHT SOC'Y U.S.A. 149, 18287 (2003) (explaining that market failure in copyright can be caused by more than transaction costs).
80. See Raymond T. Nimmer, Copyright First Sale and the Overriding Role of Contract, 51 SANTA CLARA L. REV. 1311 (2011) (arguing that copyright merely sets up background rules that are subject to change by, and indeed meant to facilitate, private ordering).
81. See Cass R. Sunstein, Incommensurability and Valuation in Law, 92 MICH. L. REV. 779, 796 (1994) ("Incommensurability occurs when the relevant goods cannot be aligned along a single metric without doing violence to our considered judgments about how these goods are best characterized." (emphasis omitted)).
82. This idea emerges in substantive due process law as well, where certain state practices are regarded as so offensive to a notion of decency that they are banned regardless of whatever value they might serve. Rochin v. California, 342 U.S. 165, 172-73 (1952) (holding that police may not forcibly extract capsules from a person's stomach in order to obtain evidence).
83. See Christine Jolls et al., A Behavioral Approach to Law and Economics, 50 STAN. L. REV. 1471, 1477-79 (1998). This source is a cornerstone account of behavioralism and the law. (Pubitemid 128421723)
84. See Christopher Buccafusco & Christopher Sprigman, Valuing Intellectual Property: An Experiment, 96 CORNELL L. REV. 1, 4 (2010) ("[A] mountain of survey and experimental data have shown that people attach substantially higher value to goods they own as compared to goods they are considering purchasing.");
85. Daniel Kahneman et al., Anomalies: The Endowment Effect, Loss Aversion, and Status Quo Bias, 5 J. ECON. PERSP. 193, 194-97 (1991) (describing the "endowment effect").
86. See MARJORIE HEINS & TRICIA BECKLES, BRENNAN CTR. FOR JUSTICE, WILL FAIR USE SURVIVE? FREE EXPRESSION IN THE AGE OF COPYRIGHT CONTROL 6 (2005) (quoting a medialiability insurance broker) (internal quotation marks omitted), available at http://www.fepproject.org/policyreports/WillFairUseSurvive.pdf.
87. See, e.g., Religious Tech. Ctr. v. Netcom On-line Commc'n Servs., Inc., 923 F. Supp. 1231 (N.D. Cal. 1995)
88. Religious Tech. Ctr. v. F.A.C.T.NET, Inc., 901 F. Supp. 1519 (D. Colo. 1995);
89. Religious Tech. Ctr. v. Lerma, 897 F. Supp. 260 (E.D. Va. 1995).
90. The First Circuit also recently upheld a district court finding of liability against an Orthodox archbishop for posting on his website translations of religious works that he had helped create but did not own. Soc'y of Holy Transfiguration Monastery, Inc. V. Gregory, 689 F.3d 29 (1st Cir. 2012).
91. See, e.g., Salinger v. Random House, Inc., 811 F.2d 90 (2d Cir. 1987).
92. See Gordon Bowker, An End to Bad Heir Days: The Posthumous Power of the Literary Estate, INDEPENDENT (Jan. 6, 2012), http://www.independent.co.uk/arts- entertainment/books/features/an-end-to-bad-heir-days-the-posthumous-power-of- the-literary-estate-6285277.html (describing the efforts of James Joyce's literary heir to use copyright as a means of suppressing any public use or textual quotation of Joyce's works, contributing to "the long absence of a comprehensive [biography] of the author").
93. Lawrence Lessig, Copyrighting the President, WIRED (Aug. 2004), http://www.wired.com/wired.archive/12.08/view.html?pg=5.
94. Lorraine Mirabella, Logo Artist Files Copyright Lawsuits Against Ravens, NFL, BALT. SUN (July 2, 2012), http://articles.baltimoresun.com/2012-07-02/ business/bs-bz-ravens-logolawsuit-20120702-1-bouchat-new-logo-baltimore-ravens (noting artist's concern that "[h]e's never gotten the appropriate credit, either personally or commercially," for creating the logo).
95. Bouchat v. Balt. Ravens Ltd. P'ship, No. MJG-08-397, 2012 WL 6738321, at &z.ast;5 (D. Md. Dec. 27, 2012).
96. (SUPEREMOFRIENDS):, http://superemofriends.com/ (last visited May 12, 2013).
97. If this example makes you wonder whether you are committing copyright infringement whenever you sing "Happy Birthday to You" to a friend in a restaurant, it should - and you probably are. See 17 U.S.C. § 106(4) (2006) (securing an exclusive right of public performance in owners of copyrighted works, including musical works); id. § 101 (defining "publicly" to include any "place open to the public"). Hence, most films with birthday-singing scenes feature the public domain work "For He's a Jolly Good Fellow" instead of "Happy Birthday to You" to avoid exorbitant licensing fees.
98. Nancy Ramsey, The Hidden Cost of Documentaries, N.Y. TIMES (Oct. 16, 2005), http://www.nytimes.com/2005/10/16/movies/16rams.html?.
99. Contemporary appropriation artists make works that are composed of preexisting art, assembling them to create new - albeit derivative - works. Jeff Koons is likely the most popularly recognizable appropriation artist, while Thierry Guetta earned recent fame thanks to being featured in the film Exit Through the Gift Shop. For a very brief overview of the genre, see Beth Gersh-Nesic, Art History Definition: Appropriation/Appropriation Art, ABOUT.COM, http://arthistory.about.com/od/glossary-a/a/a-appropriation.htm (last visited May 12, 2013).
100. Much, though not all, appropriation features transgression as a major theme and depends on unauthorized use to communicate this message. Kelley Walker observed that "[s]tealing may be a cooler, more street term for appropriation." Barbara Pollack, Copy Rights, ARTNEWS (Mar. 22, 2012), http://www.artnews.com/2012/03/22/copy-rights/ (internal quotation marks omitted).
101. Similarly, Richard Prince boasted that "I didn't exactly 'fall' [into photography] as much as steal." Laura Gilbert, No Longer Appropriate?, ART NEWSPAPER (May 9, 2012), http://www.theartnewspaper.com/ articles/No-longer-appropriate/26378 (alteration in original) (internal quotation marks omitted).
102. Margaret Jane Radin, Market-Inalienability, 100 HARV. L. REV. 1849, 1871-87 (1987).
103. Cf. id. at 1885 ("Universal market rhetoric transforms our world of concrete persons, whose uniqueness and individuality is expressed in specific personal attributes, into a world of disembodied, fungible, attribute-less entities possessing a wealth of alienable, severable 'objects.' This rhetoric reduces the conception of a person to an abstract, fungible unit with no individuating characteristics.").
104. See Gideon v. Wainwright, 372 U.S. 335 (1963).
105. A litany of cases in the past decade have entertained Speech Clause challenges to copyright laws or their enforcement. While courts have taken seriously the premise that copyright and the Speech Clause lie in tension with one another, most of these constitutional challenges have failed. See Golan v. Holder, 132 S. Ct. 873, 889-90 (2012) (rejecting a Speech Clause challenge to copyright-restoration provisions of Uruguay Round Agreements Act);
106. Eldred v. Ashcroft, 537 U.S. 186, 218-21 (2003) (invalidating a Speech Clause challenge to the Copyright Term Extension Act);
107. Universal City Studios, Inc. V. Corley, 273 F.3d 429, 435, 448 (2d Cir. 2001) (rejecting a Speech Clause challenge to an injunction issued under the Digital Millennium Copyright Act).
108. For a conspicuous exception, see Suntrust Bank v. Houghton Mifflin Co., 252 F.3d 1165, 1166 (11th Cir. 2001) (per curiam) (invalidating, on a Speech Clause theory, an injunction against publication of a parody of Gone with the Wind).
109. See generally Neil Weinstock Netanel, Copyright and a Democratic Civil Society, 106 YALE L.J. 283 (1996).
110. 17 U.S.C. § 503 (2006 & Supp. V 2011)
111. see also Cariou v. Prince, 784 F. Supp. 2d 337, 355-56 (S.D.N.Y. 2011) (ordering that appropriation artist (and his gallery) found liable for copyright infringement "deliver up for impounding, destruction, or other disposition, as Plaintiff determines, all infringing copies of the Photographs, including the Paintings and unsold copies of the Canal Zone exhibition book . . . and all transparencies, plates, masters, tapes, film negatives, discs, and other articles for making such infringing copies").
112. See Philip Hamburger, Getting Permission, 101 NW. U. L. REV. 405, 410 (2007) ("Nothing was more severely forbidden by the First Amendment's guarantee of speech and the press than licensing - the requirement that one get permission before speaking or using the press - and this proscription was fortunate.").
113. Cf. Neil Weinstock Netanel, Locating Copyright Within the First Amendment Skein, 54 STAN. L. REV. 1 (2001) (developing a doctrinal framework for subjecting copyright to Speech Clause scrutiny). (Pubitemid 33702333)
114. See id. ("Appropriation art is a well-recognized modern and postmodern art form that has challenged the way people think about art, challenged the way people think about objects, images, sounds, culture." (quoting copyright attorney Josh Schiller) (internal quotation marks omitted)). This tradition of critical copying ranges much more broadly than just modern appropriation art, having roots that go back at least as far as Marcel Duchamp. See Donald Kuspit, Spiritualism and Nihilism: The Second Decade, ARTNET, http://www.artnet.com/magazineus/features/kuspit/kuspit3-17-06.asp (last visited May 12, 2013) (cataloguing the contemporary relevance and historical importance of Duchamp's appropriative art).
115. Blanch v. Koons, 467 F.3d 244, 254-55, 259 (2d Cir. 2006) (holding that Koons' unauthorized use of a photographer's work in a collage was fair use because it parodied the owner's work).
116. Randy Kennedy, Shepard Fairey and the A.P. Settle Legal Dispute, N.Y. TIMES (Jan. 12, 2011), http://www.nytimes.com/2011/01/13/arts/design/13fairey. html.
117. Fairey's work is unapologetically appropriative, which has led some artists to criticize him as a plagiarist. Their objection is less about potential lost licensing revenue than a sense of disrespect occasioned by Fairey's failure to attribute. See Dan Wasserman, How Phony Is Shepard Fairey?, BOSTON.COM (Feb. 2, 2009, 3:49 PM), http://www.boston.com/bostonglobe/editorial- opinion/outofline/2009/02/how-phony-is-shepard-fairey.html (cataloguing complaints from artists used by Fairey and others about lack of appropriate attribution).
118. David Byrne of the Talking Heads sued Florida candidate Charlie Crist for his unauthorized use of "Road to Nowhere" in campaign stops, seeking $1,000,000 in damages. Gary Graff, David Byrne Sues Florida Gov. Charlie Crist for $1 Million, BILLBOARD (May 24, 2010, 2:31 PM), http://www.billboard.com/articles/news/958119/david-byrne-sues-florida- govcharlie-crist-for-1-million.
119. Crist settled the lawsuit and publicly apologized to Byrne. Watch Charlie Crist's Gratuitous Apology to David Byrne for Unauthorized Use of His "Unique Voice" in Campaign Ad, BILLBOARD (Apr. 12, 2011), http://www.billboard.com/biz/articles/news/1178385/watch-charlie-crists- gratuitous-apology-to-david-byrne-for-unauthorized. Jackson Browne sued John McCain for unauthorized use of his musical work "Running on Empty" in campaign stops, also resulting in a settlement and public apology.
120. Mike Masnick, John McCain Settles Jackson Browne Lawsuit over Song Use, TECHDIRT (July 21, 2009, 9:21 PM), http://www.techdirt.com/articles/20090721/ 1545365612.shtml. These examples illustrate that the expression entailed in unauthorized use can cut in both directions - a political candidate might claim a speech right to use a musical work without permission, but at the same time, the owner of that speech might counter that the unauthorized use in a political context of which she does not approve amounts to coerced speech. Of course, since that speech is not being coerced by the state, it may not rise to the level of constitutional concern.
121. Cf. W. Va. State Bd. of Educ. v. Barnette, 319 U.S. 624 (1943) (holding that the Speech Clause prevents public schools from being able to require students to say the Pledge of Allegiance or to salute the flag).
122. See Pinning 101, PINTEREST, http://about.pinterest.com/basics/ (last visited May 12, 2013).
123. See Kirsten Kowalski, Why I Tearfully Deleted My Pinterest Inspiration Boards, DDKPORTRAITS (Feb. 24, 2012), http://ddkportraits.com/2012/02/why-i- tearfully-deleted-my-pinterestinspiration-boards/ (explaining why a lawyer who is also a photographer and Pinterest user took down her Pinterest pinboards due to a concern about copyright infringement as well as out of respect for photographers' moral rights); see also E-mail from Kirsten Kowalski to David Fagundes, Professor of Law, Sw. Law Sch. (on file with author) (discussing this issue further).
124. See Sony BMG Music Entm't v. Tenenbaum, 721 F. Supp. 2d 85, 121 (D. Mass. 2010) (rejecting a fair use argument in defense of peer-to-peer file sharing, albeit also expressing reservations about draconian statutory damages), aff'd in part, vacated in part, rev'd in part, 660 F.3d 487 (1st Cir. 2011).
125. Indeed, §§ 107-122 of the Copyright Act comprise various exceptions to owners' exclusive rights. 17 U.S.C. §§ 10722 (2006 & Supp. V 2011).
126. See Campbell v. Acuff-Rose Music, Inc., 510 U.S. 569, 579 (1994) (holding that transformative uses are more likely to be fair)
127. see also Pierre N. Leval, Commentary, Toward a Fair Use Standard, 103 HARV. L. REV. 1105, 1111-16 (1990) (elaborating the notion of transformative use).
128. John Tehranian, Et Tu, Fair Use? The Triumph of Natural-Law Copyright, 38 U.C. DAVIS L. REV. 465 (2005) (arguing that the emergence and codification of fair use expanded owners' rights at the expense of users' rights).
129. Academics love to come up with the most poetic way to describe fair use's indeterminacy. David Nimmer remarked that expecting certainty from the fair use factors is "naught but a fairy tale." David Nimmer, "Fairest of Them All" and Other Fairy Tales of Fair Use, 66 LAW & CONTEMP. PROBS. 263, 287 (2003).
130. And Jessica Litman colorfully characterized much of copyright law, but especially fair use, as nothing but "billowing white goo." Jessica Litman, Billowing White Goo, 31 COLUM. J.L. & ARTS 587, 596 (2008). Others, though, have questioned whether fair use is as indeterminate as commentators typically think.
131. See Pamela Samuelson, Unbundling Fair Uses, 77 FORDHAM L. REV. 2537 (2009) (arguing that most fair use cases fit into one of several categories, and that fair use thus is more coherent and predictable than most commentators believe). I have not taken a position on this debate in this Article. Rather, my argument is that because fair use is widely perceived as indeterminate, users are often deterred from defending infringement allegations due to the uncertainty about their chances of success.
132. Neil Weinstock Netanel, Making Sense of Fair Use, 15 LEWIS & CLARK L. REV. 715 (2011) (reporting results of an empirical study showing that since 2005 the transformative use paradigm has dominated the fair use doctrine).
133. Campbell v. Acuff-Rose Music, Inc., 510 U.S. 569, 580-81 (1994).
134. See, e.g., Burnett v. Twentieth Century Fox Film Corp., 491 F. Supp. 2d 962, 967-71 (C.D. Cal. 2007) (finding that a Family Guy reference to Carol Burnett was fair use based almost exclusively on the basis of its status as parody, not satire). A court could not rely exclusively on the parody/satire distinction because § 107 requires consideration of all four fair use factors. As the foregoing example illustrates, though, judicial decisions about fair use often focus primarily and dominantly on the parody/satire distinction by resolving each of the four factors in light of parody/satire analysis. See id. at 971 (concluding that factor four weighs in favor of fair use because the use was a parody, and thus did not threaten "potential market[s] for or value[s] of the . . . work" (quoting 17 U.S.C. § 107(4) (2006)) (internal quotation marks omitted)).
135. Judges love remarking on fair use's indeterminacy as well, and they have for some time. See, e.g., Dellar v. Samuel Goldwyn, Inc., 104 F.2d 661, 662 (2d Cir. 1939) (describing fair use, even before its codification, as "the most troublesome [doctrine] in the whole law of copyright").
136. 17 U.S.C. § 504(c)(2) (2006 & Supp. V 2011) (authorizing judgments of up to $150,000 in statutory damages for a single act of willful infringement).
137. At least, that is, users who are aware of their infringement. Many lay consumptive users may not be aware of the countless ways in which they infringe copyright. For an entertaining summary of how common infringement is in daily life, see JOHN TEHRANIAN, INFRINGEMENT NATION: COPYRIGHT 2.0 AND YOU (2011).
138. See David Fagundes, Crystals in the Public Domain, 50 B.C. L. REV. 139, 151-53 (2009) (arguing that fair use's vagueness tends to deter reasonably risk-averse users).
139. James Gibson, Risk Aversion and Rights Accretion in Intellectual Property Law, 116 YALE L.J. 882, 887 (2007) (discussing how the vagueness of fair use in combination with high copyright penalties tend to expand owners' rights at the expense of users).
140. Indeed, courts tend to base factor four analyses primarily on the theoretical availability of licensing, not the actual existence of a properly functioning licensing market. Compare Am. Geophysical Union v. Texaco Inc., 60 F.3d 913, 929-31 (2d Cir. 1994) (finding that photocopies of scientific journal articles were not fair use because a new mechanism for licensing photocopies existed), with id. at 938-39 (Jacobs, J., dissenting) (observing that the purported licensing scheme was so imperfect that it did not provide a meaningful opportunity to acquire a valid license).
141. See, e.g., Dr. Seuss Enters., L.P. v. Penguin Books USA, Inc., 109 F.3d 1394, 1400-01 (9th Cir. 1997). Courts typically cite AcuffRose for the proposition that satire is per se not fair use, e.g., id. at 1400 (quoting Campbell v. AcuffRose Music, Inc., 510 U.S. 569, 580 (1994)), but this reading is doubly mistaken. First, the AcuffRose Court said only that parody is more likely to be fair use than satire, not that the latter can never be fair use. 510 U.S. at 580-81. Second, the parody/satire distinction is only relevant to factor one analysis, so even if a use's status as satire causes a single factor to weigh in favor of infringement, that does not mean the other three factors could not, on balance, result in a finding of fair use.
142. Venture Tape Corp. v. McGills Glass Warehouse, 540 F.3d 56, 63 (1st Cir. 2008) (using the phrase "actual damages" to signify plaintiff's losses).
143. See Kurt Opsahl, Facing Down a Copyright Troll in Federal Appeals Court, ELECTRONIC FRONTIER FOUND. (Feb. 6, 2013), https://www.eff.org/deeplinks/2013/ 02/facing-downcopyright-troll-federal-appeals-court.
144. See, e.g., Capitol Records Inc. V. Thomas-Rasset, 680 F. Supp. 2d 1045, 1056-57 (D. Minn. 2010) (reducing statutory damages award against defendant who illegally shared twentyfour sound recordings via a peer-to-peer network from $1,900,000 to $54,000, and explaining that the former amount of damages was "monstrous and shocking" as well as a "gross injustice" when compared to the actual gravity of the infringement).
145. It would also eliminate the "intended deterrent effect" of statutory damages that the Copyright Act's framers envisioned. H.R. REP. NO. 94-1476, at 163 (1976)
146. reprinted in 1976 U.S.C.C.A.N. 5659,5779.
147. See Gaylord v. United States, 678 F.3d 1339, 1343 (Fed. Cir. 2012) ("When . . . the plaintiff cannot show lost sales, lost opportunities to license, or diminution in the value of the copyright, many circuits award actual damages based on the fair market value of a license covering the defendant's use." (internal quotation marks omitted)).
148. Orphan Works Act of 2006, H.R. 5439, 109th Cong. § 514(a)(1)(A)(i)(ii).
149. Cf. David Olson, First Amendment Based Copyright Misuse, 52 WM. & MARY L. REV. 537 (2010) (outlining the doctrinal contours of a First Amendment-based defense to copyright infringement).
150. Eldred v. Ashcroft, 537 U.S. 186, 221 (2003).
151. Assessment Techs. of WI, LLC v. WIREdata, Inc., 350 F.3d 640, 647 (7th Cir. 2003).
152. Shloss v. Sweeney, 515 F. Supp. 2d 1068, 1080 (N.D. Cal. 2007) (refusing to enforce a copyright where its owner aimed to undermine copyright's policy of encouraging "invention and creative expression"
153. quoting Metro-Goldwyn-Mayer Studios, Inc. V. Grokster, Ltd., 454 F. Supp. 2d 966, 995 (C.D. Cal. 2006) (internal quotation marks omitted)).
154. Indeed, the Court seems to have cabined the notion of a Speech Clause defense to copyright expansions significantly in Golan v. Holder, holding that copyright laws cannot violate speech rights given the presence of speech safeguards like fair use and the idea/expression dichotomy. Golan v. Holder, 132 S. Ct. 873, 890-91 & n.30 (2012). And there is as yet just a single federal court decision precluding an owner's enforcement of its copyright on the theory that enforcement violates copyright's pro-dissemination and pro-creation policies. Shloss, 515 F. Supp. 2d 1068.
155. This was the case with the fair use defense, which existed as a general common law doctrine prior to its codification in the 1976 Act. Cf. Richard H. McAdams, A Focal Point Theory of Expressive Law, 86 VA. L. REV. 1649 (2000) (discussing law's capacity to create focal points that organize actors' expectations).
156. See Alex Kozinski & Christopher Newman, What's So Fair About Fair Use?, 46 J. COPYRIGHT SOC'Y U.S.A. 513, 525-27 (1999) (proposing ex ante compulsory licenses for derivative works).
157. For example, the Copyright Act permits users to make cover versions of musical works so long as they remit a royalty of a mere 9.1 cents per copy of each cover sold to the musical work owner. See 17 U.S.C. § 115(c) (2006).
158. MECHANICAL LICENSE ROYALTY RATES, U.S. COPYRIGHT OFF. (2010), available at http://www.copyright.gov/carp/m200a.pdf.
159. This approach has an analog in physical property law, where wrongful possessors are sometimes allowed to retain title to their improvements provided that they pay the owner for the cost of the input. See Wetherbee v. Green, 22 Mich. 311, 321 (1871) (allowing a good-faith improver of chattel property to keep the resulting goods on the condition that he reimburse the owner for the initial value of the chattels). But see CAL. CIV. CODE § 1007 (West 2007) (entitling adverse possessors to take title to real property without compensating the owner).
160. See Mark A. Lemley, The Economics of Improvement in Intellectual Property Law, 75 TEX. L. REV. 989, 1019-29 (1997) (contrasting the economic value of minor, significant, and radical improvers in copyright law).
161. For example, most § 115 compulsory licenses for mechanical reproductions of musical works in phonorecords are administered privately by the Harry Fox Agency rather than via the formal procedures outlined in the statute. About HFA, HFA, http://www.harryfox.com/public/AboutHFA.jsp (last visited May 12, 2013).
162. See David Fagundes, Property Rhetoric and the Public Domain, 94 MINN. L. REV. 652, 666-67 (2010) (observing that popular-cultural critics have derided infringers as pirates and communists and have suggested that their conduct is sacrilegious).
163. See Elisabeth Bumiller, Ascap Asks Royalties from Girl Scouts, and Regrets It, N.Y. TIMES (Dec. 17, 1996), http://www.nytimes.com/1996/12/17/ nyregion/ascap-asks-royalties-fromgirl-scouts-and-regrets-it.html.
164. Based on WestlawNext and SSRN searches performed February 18, 2013, the only use of the term "efficient copyright infringement" appears in Tiffany A. Parcher, Comment, The Fact and Fiction of Grokster and Sony: Using Factual Comparisons to Uncover the Legal Rule, 54 UCLA L. Rev. 509, 545 n.218 (2006) ("How much can warnings, disclaimers, and alert windows indicate good ethics when they accompany a product that is, in effect, a highly efficient copyright infringement machine?"
165. (quoting Stuart Meyer, The Supreme Court Speaks to Technology Companies on Ethics: MGM v. Grokster, COMPUTER & INTERNET LAW., Mar. 2006, at 34, 35) (internal quotation marks omitted)).
166. For a very recent example, see Northland Family Planning Clinic, Inc. V. Ctr. for Bio-Ethical Reform, 868 F. Supp. 2d 962 (C.D. Cal. 2012) (finding anti-abortion group's use of family planning clinic's advertising materials to be fair, albeit almost entirely on the ground that they were parody, not satire).
167. See Amy Kapczynski, The Cost of Price: Why and How to Get Beyond Intellectual Property Internalism, 59 UCLA L. REV. 970, 975-77 (2012) (discussing and critiquing "IP internalism": the notion that property-like systems are necessary or optimal ways to motivate creative production); see also, e.g., PEÑALVER & KATYAL, supra note 11 (highlighting the importance of "altlaws" only as a relatively narrow exception to intellectual property regimes).